Lebanon Businessnews News

Expenditure of $17 billion
expected in 2019 draft budget
Increase in Customs duty

and hotel occupancy fees

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The draft law for the 2019 budget projects a total expenditure of $17.1 billion.

The expenditure consists of $15.5 billion for the general budget and $1.6 billion for the auxiliary budgets.

The auxiliary budgets include the budgets of the Directorate of the National Lottery and the General Directorate of Cereals and Sugar Beets as well as the telecoms budget.

Tax on interest income has been raised to ten percent from seven percent. Interest and revenues derived from treasury bills or bonds denominated in lira will be subject to the tax increase. The interest on interbank deposits is exempt.

The tax on income from interest will remain at ten percent for three years then the rate of seven percent will be reapplied. The tax on income from interest had been previously increased from five percent to seven percent in October 2017.

An additional customs duty of two percent on imported goods will be applied until the end of 2022. Electrical and hybrid cars will be exempt as well as raw materials, machinery, and equipment used in manufacturing and agriculture.

A number of exemptions from customs duties have been revoked, according to the draft budget law. This will apply to exemptions that are part of the Customs Law or other laws.

The exemptions that will not be revoked include goods that benefit from partial or total exemption under international treaties and conventions concluded between Lebanon and other parties. Machinery and raw materials used in manufacturing and agriculture as well as equipment used by people with special needs will remain exempt. Non-polluting vehicles such as electrical or hybrid cars will continue to be exempt, as well as activities pertaining to the oil and gas sectors.

The government has introduced room occupancy fees on hotels and furnished apartments in the draft budget. The rates range from LL3,000 ($2) per night for three-star hotels to LL10,000 ($6.6) per night for five-star hotels. The fee on furnished apartments ranges from LL5,000 ($3.3) for second class apartments to LL7,000 ($4.6) for first class apartments.

According to the new draft budget law, passports will be valid for a minimum period of three years instead of one year. A fee of LL200,000 (around $133) will apply on three-year passports. The fee on five-year passports remains unchanged at LL300,000 ($200). A validity period of ten years has been introduced at a total fee of LL500,000 (approximately $332).
Reported by Shikrallah Nakhoul
Date Posted: May 22, 2019
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